The New Jersey Casino Control Commission today ordered the two founders of Caesars World Inc. to sever all ties to the company as a condition for its Boardwalk Regency casino-hotel getting a permanent license to operate in Atlantic City.
With a 5-0 vote, the commission said Clifford Perlman, Caesars' chairman, and his brother Stuart Perlman, vice chairman, must leave their positions in Caesars and all its subsidiaries, including its casinos in Nevada, because of the brothers' business ties to reputed associates of organized crime. The Perlmans also must sell their stock in Caesars and its subsidiaries, the commission said, for the Boardwalk Regency to be licensed.
The commission said that by midnight this Sunday, when the Casino's temporary license expires, Caesars must agree to the commission's conditions or have the 504-room hotel complex be taken over by a state-appointed conservator. Further, the commission ordered Caesars officials to return for a hearing by Nov. 26 and lay out a schedule for the Perlmans' stock divestiture for Caesars to get its licence here.
The Perlmans, who founded Caesars' forerunner company in 1958 and helped build Caesars into the world's most profitable gambling company, own a total of 18 percent of Caesars World's stock. That stock is worth about $69 million today, company spokesman said.
The commission also voted last night to grant licenses to two other company officials, Chief Operating Officer William H. McElnea Jr. and Senior Vice President Jay Leshaw. The New Jersey Division of Gaming Enforcement, the state's casino investigator and prosecutor, had opposed licensing these two men, along with the Perlmans and Caesars World itself.
The company's board of directors met tonight to consider whether to ban the Perlmans and keep the Boardwalk Regency, in which Caesars owns an 86 percent interest, or to sell the Atlantic City hotel, a company spokesman said.
Margaret Kilgore, a spokeswoman for the Los Angeles-based Caesars, said there is "a possibility, a small one," that the company will decide to keep the Perlmans and give up its interest in Atlantic City. But company officials know they probably would face lawsuits from Caesars World's 70,000 shareholders if it takes that course, Kilgore said.
Clifford Perlman, known as the driving force behind Caesars since its inception, refused comment on the decision.
But Stuart Perlman said, "I'm only telling you one thing. I'm proud of my company. I'm not ashamed of it."
The vote on McElnea was 4-1, with Commissioner Martin Danziger dissenting.